Commentary on Economics, Information and Human Action

Economic understanding: “there’s a lot of confirmation bias out there”

Do liberals or conservatives of libertarians tend to have a better understanding of economics? It is a question that Daniel Klein and Zeljka Buturovic investigated in a pair of papers appearing in Econ Journal Watch (one and two). The first paper appeared to show that a college education didn’t lead to much improvement in economic understanding, but self-identified “very conservative” persons and libertarians seemed to have a better grasp of the issues than self-identified liberals and progressives.

As it turned out, however, the questions asked were ones in which the correct answer tended to be the answer a conservative or libertarian would favor on ideological grounds. When in the second study they asked more questions for which economic analysis tended to favor liberal rather than conservative views, the performance of liberals improved and the performance of conservatives dropped off.